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Ramalingam

Ramalingam Kalirajan  |7015 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Apr 16, 2024

Ramalingam Kalirajan has over 23 years of experience in mutual funds and financial planning.
He has an MBA in finance from the University of Madras and is a certified financial planner.
He is the director and chief financial planner at Holistic Investment, a Chennai-based firm that offers financial planning and wealth management advice.... more
Srinath Question by Srinath on Apr 16, 2024Hindi
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I am 31 years old and I want to invest 50K each in 2 ELSS funds through SIP. Can you guide me 2 ELSS funds which are the best one to invest and my equity risk appetite is high. My aim is get 1 Cr from the two funds in next 4-5 years

Ans: For a high-risk appetite and a 4-5 year horizon, you can consider diversified ELSS funds known for consistent performance and managed by experienced professionals. Look for funds with a track record of outperforming their benchmarks and peers. Always remember to monitor your investments regularly and consult a financial advisor for personalized advice.
DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.
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I'm 26 years old and want to invest 50 k each in two ELSS schemes as a SIP to achieve a corpus of 1 cr. Is my strategy right? Or if there is a change can you please guide me accordingly. I've close to 10 lacs in FDs
Ans: Your aspiration to build a corpus of 1 crore through ELSS SIPs is commendable. However, let's evaluate your strategy and explore potential adjustments to optimize your investment approach.

Assessing Your Strategy
ELSS SIPs:
Equity Linked Savings Schemes (ELSS) offer the twin benefits of tax savings under Section 80C of the Income Tax Act and potential for wealth creation through equity exposure. Investing 50,000 each in two ELSS schemes through SIPs is a proactive step towards your financial goals.

Existing FDs:
Having close to 10 lakhs in FDs indicates a conservative investment approach. While FDs provide stability, their returns may not be sufficient to achieve long-term wealth creation goals, especially considering inflation and taxes.

Suggested Adjustments
Diversification:
Consider diversifying your investment portfolio beyond ELSS and FDs. While ELSS SIPs offer the potential for high returns, they also carry market risks. Diversification across asset classes like equity, debt, and real estate can help mitigate risk and optimize returns.

Review FD Allocation:
Reevaluate the allocation of your FDs. While FDs provide liquidity and stability, consider whether tying up a significant portion of your savings in low-yield investments aligns with your long-term wealth creation goals. You may explore gradually reallocating a portion of your FDs towards higher-yielding investment avenues.

Regular Review:
Periodically review your investment portfolio to ensure alignment with your financial goals, risk tolerance, and market conditions. As your financial situation evolves, be prepared to make necessary adjustments to optimize returns and minimize risk.

Alternative Investment Options
Since you're open to suggestions beyond ELSS and FDs, here are a few alternatives to consider:

Equity Mutual Funds:
Apart from ELSS, explore other equity mutual fund categories such as large-cap, mid-cap, and multi-cap funds to diversify your equity exposure further.

Debt Mutual Funds:
Consider allocating a portion of your portfolio to debt mutual funds for stability and regular income. Debt funds invest in fixed-income securities like bonds and provide relatively lower but steady returns compared to equity.

Systematic Investment Plans (SIPs):
SIPs offer the benefit of rupee-cost averaging and disciplined investing. You can explore SIPs in both equity and debt mutual funds to maintain a balanced portfolio.

Conclusion
While your strategy of investing in ELSS SIPs is a step in the right direction, consider diversifying your portfolio and reviewing your FD allocation to optimize returns and mitigate risks. A balanced approach tailored to your financial goals and risk profile will enhance your chances of achieving long-term wealth creation.

Best Regards,

K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |7015 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 06, 2024

Asked by Anonymous - Jun 30, 2024Hindi
Money
I am 42 and have one son with my wife. Holding salary of 60000/- monthly in hand. Have investments in two ELSS scheme one is ?500 every month and other ?8000 lumpsum for 3 years. Regularly invest in NPS ?1000 monthly. Holding SGB Bonds value ?38000/-.I want to invest ? 5000 monthly in SIP for long tenure of 17 years. Pls suggest
Ans: You are 42, have a son, and a monthly salary of Rs. 60,000. You already invest in ELSS schemes, NPS, and SGB Bonds, and now you want to invest Rs. 5000 monthly in SIP for 17 years. Here’s a comprehensive plan to guide you towards your financial goals.

Understanding Your Financial Situation

Let’s break down your current financial status and future investment plans:

Monthly Salary: Rs. 60,000
ELSS Investments: Rs. 500 monthly and Rs. 8000 lumpsum for 3 years
NPS Investment: Rs. 1000 monthly
SGB Bonds: Rs. 38,000 value
New SIP Investment: Rs. 5000 monthly for 17 years
Step 1: Assessing Your Financial Health

First, evaluate your monthly expenses and savings.

Monthly Income: Rs. 60,000
Essential Expenses: Calculate monthly living costs including household expenses, child’s education, and other necessary expenditures.
Current Savings and Investments: Summarize your existing investments in ELSS, NPS, and SGB Bonds.
Step 2: Building an Emergency Fund

Before investing, ensure you have an emergency fund covering 6-12 months of expenses.

Emergency Fund: Save Rs. 3-6 lakhs in a liquid fund for emergencies.
Step 3: Managing Existing Investments

Review your existing investments to ensure they align with your financial goals.

ELSS Schemes: Continue with your current ELSS investments for tax-saving benefits.
NPS: Your Rs. 1000 monthly contribution in NPS is good for retirement planning.
SGB Bonds: Hold onto your SGB Bonds for gold investment benefits and interest income.
Step 4: Investing in SIP for Long-Term Growth

Systematic Investment Plans (SIPs) in mutual funds are ideal for long-term wealth creation. They offer the power of compounding and professional management.

Advantages of SIPs in Mutual Funds

Disciplined Investing: Regular investments instill discipline.
Rupee Cost Averaging: Invests in different market conditions, reducing risk.
Compounding: Reinvested returns generate more returns over time.
Diversification: Invests in a variety of assets, reducing risk.
Choosing the Right Mutual Funds

Select a mix of equity and debt funds to balance risk and returns.

Equity Funds: High returns but higher risk. Suitable for long-term goals like retirement and child’s education.
Debt Funds: Lower risk and returns. Good for stability and short-term goals.
Hybrid Funds: Mix of equity and debt. Moderate risk and returns.
Creating a Diversified SIP Portfolio

Equity Funds: Invest 60-70% in diversified equity funds. Focus on large-cap and multi-cap funds for stability and growth.
Debt Funds: Invest 20-30% in debt funds for stability. Consider corporate bond funds or gilt funds.
Hybrid Funds: Invest 10-20% in hybrid funds for balanced risk and returns.
Step 5: Setting Up Your SIP

Start a SIP of Rs. 5000 monthly in a diversified portfolio of mutual funds.

Monthly SIP Amount: Rs. 5000
Step 6: Regularly Review Your Investments

Monitor your investments to ensure they are on track.

Annual Review: Assess your portfolio’s performance annually.
Rebalancing: Adjust the allocation if needed to maintain the desired risk level.
Step 7: Tax Planning

Optimize your investments for tax efficiency.

ELSS Funds: Continue with ELSS for tax benefits under Section 80C.
Other Tax-Saving Instruments: Consider PPF, EPF, and NPS for additional tax benefits.
Step 8: Planning for Child’s Education

Ensure you have a plan for your child’s higher education. Set aside a separate fund for this purpose.

Children’s Education Fund: Invest in child-specific mutual funds or a combination of equity and debt funds based on the time horizon.
Step 9: Retirement Planning

Your retirement plan should be robust to ensure you maintain your lifestyle post-retirement.

Retirement Corpus Goal: Rs. 1 crore
Investment Strategy: Continue investing in a mix of equity and debt funds.
Retirement Accounts: Contribute to EPF, PPF, and NPS for additional retirement savings.
Step 10: Insurance

Ensure you have adequate insurance coverage to protect your family.

Life Insurance: Adequate term insurance to cover liabilities and provide for your family.
Health Insurance: Comprehensive health insurance to cover medical expenses.
Final Insights

Creating a robust financial plan is essential for long-term financial stability and achieving your goals. Here’s a summary of your action plan:

Action Plan Summary

Assess Expenses: Calculate monthly expenses and savings.
Emergency Fund: Set aside Rs. 3-6 lakhs.
Manage Existing Investments: Continue with ELSS, NPS, and SGB Bonds.
SIP Investments: Start a monthly SIP of Rs. 5000 in diversified mutual funds.
Review Investments: Regularly review and rebalance the portfolio.
Tax Planning: Optimize investments for tax efficiency.
Education Planning: Create a separate fund for your child’s education.
Retirement Planning: Continue building your retirement corpus.
Insurance: Ensure adequate life and health insurance coverage.
By following this comprehensive plan, you can achieve your long-term financial goals and ensure a secure future for yourself and your family.

Best Regards,

K. Ramalingam, MBA, CFP

Chief Financial Planner

www.holisticinvestment.in

..Read more

Latest Questions
Ramalingam

Ramalingam Kalirajan  |7015 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Nov 14, 2024

Asked by Anonymous - Nov 13, 2024Hindi
Money
Hi sir Kindly review my portfolio.. Investing below amount in SIP 1)Large cap - Axis 4500 Nippon 4500 2) Flexi cap - Parag parikh - 3000 Icici - 2500 3) Mid cap - Motilal - 2500 Aditya birla - 500 Kotak - 500 4) Small cap Tata - 1500 My goal for investing is my child education, child marriage and Retirement funds I planning to invest for next 15 years Kindly suggest which and all mutual fund I have to continue and remove for better returns.. Thank you
Ans: It’s great to see that you’re committed to securing funds for your child’s education, marriage, and retirement. These are critical milestones, and with the right approach, your investments can help you achieve them effectively.

Investment Goals and Approach

You have clear long-term objectives, which is ideal. Planning with specific goals like education, marriage, and retirement brings purpose to your investment journey. Given the 15-year investment horizon, you can take advantage of compounding benefits, especially with equity mutual funds. However, let’s ensure your portfolio is optimized for growth, risk, and tax efficiency.

Evaluating Your Mutual Fund Choices

Let’s look at your current investments across various categories:

1. Large Cap Funds
Large-cap funds provide stability, as they invest in established companies with relatively lower volatility. However, there can be limited scope for very high growth in large caps compared to mid or small caps.

You’re invested in two large-cap funds. It’s often advisable to focus on one high-performing large-cap fund to avoid overlap and unnecessary diversification.

Consider retaining a large-cap fund that has a consistent track record, active fund management, and strong research backing.

2. Flexi Cap Funds
Flexi-cap funds offer flexibility by investing across market caps. This allows the fund manager to capture growth opportunities in any segment of the market.

Holding two flexi-cap funds is fine, as it balances large and mid-cap stocks, offering both stability and growth. However, evaluate each fund’s performance and select one if you feel any duplication in returns.

3. Mid Cap Funds
Mid-cap funds offer growth potential but come with higher risk. Given your long-term horizon, they can be beneficial.

You currently have three mid-cap funds. It might be better to consolidate into one or two top-performing funds in this category to reduce excessive overlap and diversify across sectors rather than just fund names.

4. Small Cap Fund
Small-cap funds are suitable for aggressive growth but can be highly volatile. It’s wise to limit exposure to small caps, as they tend to fluctuate significantly, especially over shorter timeframes.

Given your portfolio composition, your allocation to small caps is moderate, which seems appropriate. However, ensure you are comfortable with the high-risk nature of small caps, especially if the market faces downturns.

Analysis of Direct vs. Regular Funds

Opting for direct funds might appear attractive due to lower expense ratios, but it’s crucial to weigh the potential downsides:

Lack of Guidance: Direct funds lack the guidance a Certified Financial Planner (CFP) can offer. Expert support ensures your portfolio is regularly rebalanced and aligned with market changes, personal goals, and tax updates.

Regular Tracking: With a CFP’s help, your investments are reviewed frequently, making timely adjustments in case of underperformance. This hands-on approach is particularly helpful in achieving your long-term goals.

Tax Considerations: Regular funds through a CFP can help you optimize tax efficiency by offering proactive advice on capital gains, loss harvesting, and adjusting investments according to the new capital gains tax rules.

Importance of Actively Managed Funds

While index funds may seem attractive for their lower costs, actively managed funds bring added advantages, especially for long-term investors like you:

Potential for Higher Returns: Skilled fund managers actively seek growth opportunities that can outperform benchmarks over time. This could be a significant advantage given your long-term goals.

Flexibility in Market Movements: Active funds allow managers to make informed changes, adapting to market conditions and potentially protecting your investments during volatile phases.

Diverse Exposure: With active management, your funds are better diversified across sectors and stocks, reducing concentration risk and enhancing the potential for stable returns.

Investment Strategy Recommendations

Considering your goals and time horizon, here’s a comprehensive approach to optimize your portfolio:

Consolidate Fund Choices: Consider reducing similar funds within each category. This will provide clarity and focus, making it easier to track progress and reduce management complexity.

Review and Rebalance: Regularly review your portfolio performance, preferably with a CFP, to ensure each fund aligns with your risk tolerance and goals. Aim for annual rebalancing to stay on track.

Allocate Based on Goals: Assign specific funds for each goal. For example:

Child’s Education and Marriage: Given the moderate-to-high timeframe, allocate funds with a mix of stability (large-cap and flexi-cap funds) and growth (mid-cap).
Retirement: Invest in a diversified mix of flexi-cap and large-cap funds, along with a smaller allocation to mid-caps, as retirement is a long-term goal with a potentially higher investment horizon.
Avoid Overlapping: Limit overlap between funds by choosing those with unique holdings or management strategies. Too many funds can dilute returns, especially if they invest in similar stocks.

Tax Considerations

With recent changes in capital gains tax rules, be mindful of the following when planning exits or rebalancing:

Equity Mutual Funds: Long-term capital gains (LTCG) above Rs 1.25 lakh are now taxed at 12.5%. Short-term capital gains (STCG) are taxed at 20%.

Debt Funds: LTCG and STCG for debt funds are taxed according to your income tax slab.

Tax Efficiency: To minimize tax outgo, hold investments for the long term and consult a CFP for tax-optimized rebalancing.

Investment Horizon: Sticking to your 15-year investment plan can help mitigate tax impacts and optimize returns.

Insurance Evaluation

If you hold any LIC, ULIP, or investment-linked insurance policies, review their performance and fees. These products often come with high costs, which can limit returns. Consider surrendering such policies if they don’t align with your goals and reinvest in well-performing mutual funds instead.

Finally

Your commitment to a 15-year SIP plan shows your dedication to securing your family’s future. A structured, diversified approach with periodic reviews can enhance your portfolio’s performance, aligning it with your goals of education, marriage, and retirement.

A Certified Financial Planner can be a valuable partner in this journey, providing expert advice to help you make the most of your investments and adjust them as needed.

Best Regards,

K. Ramalingam, MBA, CFP

Chief Financial Planner

www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment

...Read more

Ravi

Ravi Mittal  |414 Answers  |Ask -

Dating, Relationships Expert - Answered on Nov 13, 2024

Asked by Anonymous - Nov 04, 2024
Relationship
my gf was physical(intercourse) just for once with her ex and her ex cheated on her she just had a 2 month relationship with her ex. and after that around just after a month we came in relationship and its been 2 months we are in a relationship we both go to same college but due to house problem she doesn't attend classes basically we are in a long distance relationship and she still remember him and when she goes to places where she meet her ex she still have flashback She is not fully with me even when i just ask her for a normal kiss she refuses and tells me what so hurry but when i asked her does she want to stay with me she told me yes i want to stay with you and she is ready to marry me as well when time comes she even told me that timely she will have feelings for me And for me all this is new this is my first relationship what should i do?
Ans: Dear Anonymous,
Refusing for a kiss isn't as concerning as her saying she will have feelings for you. Not everyone is ready for intimacy at the same time in all their relationships. As I mentioned earlier, there can be several reasons for this behavior. Please have an open conversation with her. Let her know that her behavior is bothering you and you want some clarity. If she still continues to say the same thing, you have the option to rethink the relationship.

I understand that you are feeling disturbed; it's not easy being on the receiving end. Please feel free to pick yourself first. You deserve someone who loves you completely.

Best Wishes.

...Read more

Ravi

Ravi Mittal  |414 Answers  |Ask -

Dating, Relationships Expert - Answered on Nov 13, 2024

Asked by Anonymous - Nov 07, 2024Hindi
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Relationship
I am 28, will be engaged in 3-4 months. It's an arranged marriage. I have met the girl one time, that too she was accompanied with her parents as her family is very conservative. We spoke privately for about half an hour. I know it's still not enough but I was able to have a good conversation. She was nervous at first but I made her feel comfortable and it was then time well spent. She is a sweet girl, even my maa papa like this girl but on the other hand, I am also getting worried as the days are coming near. Sometimes I feel like postponing the event. Is this normal? I also fear of things that happens in nowadays like getting divorce, extra marital affairs, alimony etc. What if she finds a better partner after marriage? Will she leave me? Due to this I cannot have proper sleep recently. Any suggestions to calm my nerves?
Ans: Dear Anonymous,
Many people get cold feet before getting married. It is very normal. All your questions are valid but you need to understand that in every relationship, it all comes down to trust. Whether you marry this woman or someone else, you have to trust her. And no one can really tell what the future holds. So we focus on the present and hope for the best.

I suggest speaking to your would-be partner a little more in the meantime. Getting to know her will put these doubts to rest. I'm sure she is equally concerned about what kind of person you are. Moreover, it is always a good idea to get to know each other better before committing for a lifetime. And, in case, you still think you need to postpone the event, do not shy away from doing so. It is better to take some time and make the right decision than to make a wrong decision in a hurry.

Hope this helps.
Best Wishes.

...Read more

Dr Shakeeb Ahmed

Dr Shakeeb Ahmed Khan  |123 Answers  |Ask -

Physiotherapist - Answered on Nov 13, 2024

Asked by Anonymous - Sep 15, 2024Hindi
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Health
Hi sir , Iam male 27 years planning to reduce my current weight of 86KG hence planning to hit the gym. Iam concerned of abdominal fat. I left gym 3 yrs back when my weight was average 69kgs. However due to no physical activity weight increased. Now iam planning for reducing weight and also improve my strength with good muscular lean body not bulk. Please guide me sir thanks
Ans: It’s wonderful that you’re enthusiastic about getting back into the gym to work towards weight loss and a lean, toned physique! As a physiotherapist, I suggest scheduling regular check-ins with a physiotherapist to monitor your progress and make any necessary adjustments to your exercise routine. To effectively lose fat, particularly around the abdomen, while building muscle, try a balanced approach that incorporates both cardio and strength training. Start with 20-30 minutes of moderate-intensity cardio—like brisk walking, cycling, or jogging—three to five times per week to increase calorie burn. For strength training, focus on compound exercises such as squats, lunges, push-ups, and rows, with three sessions per week. Begin with lighter weights, increasing gradually as your strength builds, and focus on good form to develop lean muscle without bulk.

Including core exercises, like planks, Russian twists, and leg raises, will help to strengthen and tone your abdominal muscles; however, remember that fat loss from specific areas requires overall body fat reduction. A high-protein, balanced diet will be crucial for supporting muscle growth and managing hunger, so aim to reduce processed foods and sugars. Consistency is essential—maintain a regular exercise schedule, and ensure you have rest days for recovery. With dedication, you’ll see steady improvements over time. Best of luck, and don’t hesitate to reach out if you need further guidance!

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DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Investment in securities market are subject to market risks. Read all the related document carefully before investing. The securities quoted are for illustration only and are not recommendatory. Users are advised to pursue the information provided by the rediffGURU only as a source of information and as a point of reference and to rely on their own judgement when making a decision. RediffGURUS is an intermediary as per India's Information Technology Act.

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